Nigeria’s economic woes dampened further, as the United States and India, major buyers of its oil announced reduction of their imports by 53 per cent and 43per cent, respectively.
This, according to the Nigerian National Petroleum Corporation translates to a loss of about N88.6bn in earnings for the country, which derives more than 80 per cent of its revenue from oil.
The latest report from India, which became the single largest buyer of Nigerian crude in 2013 after the US, said it had been reducing its imports from Nigeria since May this year, buying 7.74 million barrels, down from 13.51 million barrels in April; 12.51 million barrels in March and 12.70 million barrels in February.
In January the Asian country had imported 16.29 million barrels of Nigerian crude, its highest monthly level this year, said NNPC staff.
But the US, whose imports of Nigerian crude rose by 577.8 per cent in the first quarter of this year compared to the same period of 2015, reduced its import by 5.77 million barrels in May from 10.13 million barrels in the previous month.
In February, the US bought as much as 12.12 million barrels from Nigeria, making it the second largest buyer of the country’s crude after India.
The decrease of 11.14 million barrels in the two countries’ imports of Nigerian crude amounts to N87.9bn, which may have some negative effects on Nigeria’s economic recovery plans.
Global benchmark, Brent crude, had on May 26 hit $50 for the first time in 2016.
Three of Nigerian oil grades, Forcados, Qua Iboe and Brass River – have in the past three months been under force majeure – a legal clause that allows companies to cancel or delay deliveries due to unforeseen circumstances.
Following the spate of production disruptions largely caused by the recent surge in militant attacks on oil
infrastructure in the Niger Delta that cut the nation’s output to the lowest in almost three decades, exports of the commodity from the country have continued to take a serious beating.
Nigeria relies on earning from oil exports to recover from its present economic crisis, which has seen the economy in its worst form in decades, and recovery may be difficult to achieve given the new development.
By Emma Eke
RipplesNigeria …without borders, without fears
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